Asked by Klaudia Kuzia on May 26, 2024
Verified
Which of the following does not properly describe reasons for a retailer of pianos having 30 stores to acquire control of another retailer of pianos having 12 stores?
A) The companies would be vertically integrated to have access across United States markets.
B) The companies would be integrated for horizontal growth by having more retail stores to sell pianos.
C) The companies would be integrated to experience synergies in delivery costs to customers because pianos could be shipped from a central warehouse in each geographic territory.
D) The companies would be integrated to share advertising costs.
Vertically Integrated
A strategy where a company expands its operations into different stages of production within the same industry, from raw materials to finished products.
Horizontally Growth
Expansion strategy whereby a company grows by acquiring or merging with firms in the same industry at the same level of the supply chain.
Synergies
The additional value created by the combination of two or more companies, parts, or processes to achieve greater performance as a whole than the sum of their individual parts.
- Understand the implications of owning different percentages of voting stock on financial reporting and consolidation.
Verified Answer
Learning Objectives
- Understand the implications of owning different percentages of voting stock on financial reporting and consolidation.
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